Energy Transition Handbook 2021 - Flipbook - Page 45
Energy Transition Handbook 2021
roughly 30 countries across the Middle East,
Africa, Central and South America, Europe,
and Southeast Asia are considering or
beginning new nuclear power programs.
Hungary and Poland are planning to site
new nuclear reactors to replace retired coal.
A United Kingdom government whitepaper
sets forth the Prime Minister’s plan to tackle
climate change and includes both large
and small scale nuclear. Rolls-Royce is also
working to build 16 SMR plants in the UK
within 10 years to help cut electricity costs and
China has 49 operable nuclear reactors and
16 currently under construction. Its recent
construction of four Hualong One reactors is
the first nuclear plant project in the country
to use private funding. China estimates that it
could build as many as 30 overseas reactors
by 2030, earning up to about $145 billion and
employing up to 5 million Chinese workers.
Russia has 38 reactors in operation and 2
under construction domestically, and has
stated that its book of business for nuclear
construction projects is well over $130
billion. It developed the first modern floating
SMR technology, and is paving the way for
fast reactors with closed nuclear fuel cycles
through its Proryv Project where fuel is
recycled to reduce nuclear waste.
in Germany, a lifespan extension for nuclear
power plants was approved in October
2010, but by 30 June 2011 the decision had
been made to phase out nuclear power.
That decision represents Germany’s most
significant political and economic response to
the events in Fukushima. Germany wants to
curb greenhouse gas emissions but at the same
time will shut down all of its nuclear power
stations, which in the year 2000 had a 29.5
per cent share of the power generation mix.
In 2020 the share was down to 11.4 percent,
and by 2022 all nuclear plants are going to be
shut down, so there is a substantial workflow
to decommission all of the nuclear power plants.
low power prices (exacerbated by the
abundance of US shale gas) make replacing
existing nuclear fleets nearing the end
of their life and building new nuclear
massive capex requirements mean that very
few investors are able to finance projects
on balance sheet, whilst highly complex
construction requirements and technology
risk mean that projects are rarely able to
be financed using debt without some form
of underwriting from a government entity
(whether from the project host government
or underwriting the technology supplier).
as exemplified by most recent new build
nuclear projects outside of China, a high
construction cost (and time) variance
from the base case arises from, amongst
others, the lengthy construction period,
highly complex contractor interface issues
and the extremely low tolerance for errors.
complex and lengthy permitting and
potential liability arising from a nuclear
incident and non-proliferation issues –
these are governed mainly by international
convention, with two broad regimes applying
for nuclear liability but varying by jurisdiction
depending on how the relevant conventions
have been implemented in the host nation
(further complicated for damage caused in
third party nations).
political sensitivity and public opposition
leading to a high degree of political risk in
jurisdictions that are otherwise considered
stable – the requirement for all German
nuclear power stations to cease operation
being a recent example of this.
small modular reactors have the potential to
offer lower cost and more localised solutions
that may be able to generate zero carbon
hydrogen and/or heat alongside.